Monday, February 8, 2016

Ikea’s Evolution from Fit Furniture to Fine Food Fast

Ikea’s furniture will fit in any room of any house even a studio apartment in New York City.  Back in 2013 the Wall Street Journal reported that Ikea its “Food division is was fast becoming a behemoth…with nearly $2 billion in annual revenue.” Grocerant niche mix and match bundling has continued to fuel success at Ikea according to Foodservice Solutions® Grocerant Guru®. 

Ikea’s U.S. president Lars Peterson said in a recent interview in the Washington Post that “Ikea food is becoming a core business” for the privately-held, Sweden-based company” Clearly the $2 Billion was just the platform to drive incremental growth. 

Peter Ho, a product developer in Ikea’s food division reported that “Ikea Food saw sales surge 8 percent in the U.S. over the previous year, outpacing the 4.5 percent sales growth seen at its U.S. stores open more than a year” Did your restaurant drive sales 8% last year? 

Ho went on to say “Foot traffic to Ikea’s restaurants is also “trending better” than foot traffic to the furnishings areas of their stores… In other words, there are a significant number of customers who come to Ikea just to eat, and the chain is trying to figure out how to cater to them better.”

All of Ikea’s 41 US stores are getting restaurant makeover in the next several months. “Instead of the current setup, which is a spare, open space, the goal is to create three zones for different types of diners.” According to Ho.

1.       One area will be outfitted with high tables and barstools suited for scarfing down a quick bite.  
2.       A second will aim to be family-friendly, with activities for kids and tables for their parents to dine nearby.
3.       The third area they call “Fika,” which is a Swedish word for a coffee break that involves socializing.  As the name suggests, the space is meant to offer something of a coffee house vibe: Cushy chairs and couches that are changed out several times a year to create a homey, seasonal spot where you’d feel comfortable lingering and chatting with friends. (And that might also inspire you to buy the furniture you’re sitting on, which will always be pulled directly from Ikea’s current line-up.)

Ikea’s grocerant Ready-2-Eat and Heat-n-Eat strategy is part of a broader push in casual and quick-service dining that is likely to become more competitive by leveraging existing restaurant space for different meals, or “day parts,”. 

New menu items reflect consumers’ changing dietary preferences Ho explained that “foe starters, there’s now a veggie version of the famous meatball, which contains chickpeas, kale, peas, and other ingredients.  They’ve also added a chicken version of the meatball, which they say is produced in a more sustainable way than their traditional meatball.”

At Ikea “better for you” includes sustainable seafood as of last year Ikea is now “sourcing all of its fish from supplier that use sustainable fishing practices.” Is your retail brand ready to drive incremental sales?  Have you considered entering the grocerant niche?  Maybe it’s time.  

Restaurants, Grocery stores, C-stores, Liquor stores, furniture stores or any retailer it time to invite Foodservice Solutions® to complete a Grocerant Scorecard or a Grocerant Program Assessment before you start your remodel or new test concept.  Since 1991  of Tacoma, WA has been the global leader in the Grocerant niche, or Contact:

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